European Court of Justice rules that OTAs can no longer enforce hotel price parity

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• JDB says:

  27 Sep27 September 06:35

  Hotels haven’t greatly respected the price parity clauses anyway, with many ways of officially or unofficially circumventing the arrangement, so much of this is quite academic. Even rates such as FHR and the Mastercard/Visa equivalents undercut OTA rates by offering additional benefits and F&B credits etc.

  The price a more expensive hotel shows on its website isn’t too far off the price in an antique shop – a starting guide only. Commissions have also greatly reduced from the 22% mentioned, so the dynamics within the industry are changing.

  • Thywillbedone says:

    27 Sep27 September 06:57

    I’m not sure FHR ever truly undercuts the lowest OTA rates. Yes if you add up the benefits and put a monetary value on each of them, you can theoretically come out ‘on top’ but it assumes you would pay cash for all of those particular benefits anyway which I doubt is the case for most …

    Regarding the idea that hotels might be worried about being placed on page 20 something of Booking.com’s list of hotels for a location, do not most people start with TripAdvisor as the most comprehensive indicator of satisfaction and go from there?

    • JDB says:

      27 Sep27 September 07:22

      I would agree that FHR is pretty pointless but if the rate on the OTA is $350 room only whereas FHR is $350 bed, breakfast and $100 credit, most would consider that cheaper or ‘discounted’ vs OTA.

      • jj says:

        27 Sep27 September 08:46

        FHR sometimes has 4-for-3 and similar deals that aren’t available on other OTAs or on the hotel’s own booking site. I’ve had two of those this year, saving considerably more than the Platinum fee in total. The other FHR benefits are available, and the hotel wasn’t interested in a price match for a direct booking.

    • Ken says:

      27 Sep27 September 07:24

      If you are choosing via reviews no tripadvisor (still partially owned and controlled by Expedia ?) many people will then just click through from there rather than open another app or website.

    • patrick C says:

      27 Sep27 September 07:26

      No as trip advisor generally has the worst and most useless hotel reviews.
      Also the entire website is really not user friendly
      For hotels I barely click on TripAdvisor. Even for restaurants i skip it as it is mostly people.posting with no sense of taste (given thst burher chains often end up on top 😉 )

      • BBbetter says:

        27 Sep27 September 07:54

        You can try to filter out the nonsense. Only one review, meaningless appreciation and superlatives are red flags. The other way to approach is to ignore both one star and five star ratings as one star are usually those who f*d up the booking and take it on the hotel staff or entitled ones not getting an upgrade.
        Most annoying is the trend to name every staff – I think these are posted or pushed by the staff themselves. Highlight just one or two who went out of the way to help you.

        • John says:

          27 Sep27 September 15:15

          I generally only read the one star reviews. You can usually tell if it was the guest who misunderstood something or screwed up, or whether frequent one star reviews all have a common theme, indicating there is some truth in it and it’s not worth risking the same thing happening to you.

      • Matarredonda says:

        27 Sep27 September 13:36

        Couldn’t agree more so rarely if ever look at it.

    • Andrew. says:

      27 Sep27 September 08:06

      Not sure about “most people”, I tend to plan stays around location and brand experience.

      I really don’t have time for country-bumpkins posting reviews claiming that they felt “scared” because there was a homeless person begging outside a hotel in a major city.

      The only thing I really want to see in a review is something that tells me that:-

      “The self-service toaster was utterly amazing. No matter the bread product, it delivered golden, hot, utter perfection speedily every single time.”

    • paul says:

      27 Sep27 September 08:29

      Thankfully, most people are lazy so will go straight to an OTA like booking-dot-com where price comparison comes first, followed by reviews.

      As an ex hotel owner, TripAdvisor were always horrendous because anyone can leave a review – so idiots would relish in it.

      At least reviews on OTAs can only be submitted by actual booked guests.

      Yes, a hotel owner can book a room at their own hotel and for as little as £5 in commission can falsely review themselves. It’s not widespread though.

      And the reviews on a hotels own website are often legit, the software running it can be set to only display the best reviews

  • Ken says:

    27 Sep27 September 07:15

    FHR has no significance to the overall OTA hotel market..
    It’s hard to imagine the current arrangement being anything other than anti competitive.

    This is a good example of the EU ‘interfering’ in the ‘free’ market & hopefully the UK will follow suit.
    Not dissimilar to interchange fees.

• Paul says:

  27 Sep27 September 07:29

  Another Brexit benefit! Rip off Britain, (sorry deregulated) can continue to be place consumer protection comes to die.

  I don’t usually use an OTA as I prefer dealing directly with hotels and airlines and tend to use Google maps for location searching.

  Tripadvisor is a busted flush now as it is primarily a selling site and it’s necessary to wade through hundreds of one hit wonders.who post about wonderful or horrible hotels that are the polar opposite of their experience. I ignore all reviews from anyone with less than 30 reviews

  • JDB says:

    27 Sep27 September 07:46

    @Paul – we don’t agree on much but you are spot on re TripAdvisor. I can’t think why anyone would rely upon it these days. It is so polluted with nonsense reviews as to render the whole thing valueless and the rating system is just ridiculous.

  • Ken says:

    27 Sep27 September 07:57

    When the World Hotels cash back was highlighted on the site a couple of days ago, I checked a couple of hotel reviews on trip advisor. It was difficult to imagine a more blatant ‘review farming’ – all recent ones mentioning how brilliant Mr X had been…

    I wish Rob had mentioned that World Hotels was a Best Western brand…

  • Fennec says:

    27 Sep27 September 17:07

    UK domestic competition law mirrors EU competition law exactly.

    Accordingly, the UK remains in EEA regulatory orbit regardless of Brexit so this will affect the UK too unless the OTAs would be confident of persuading the UK Supreme Court that Little England is a special case.

• Greenpen says:

  27 Sep27 September 07:40

  Very interesting background to hotel pricing. I have frequently wondered why a
  hotel has the same or higher prices than a travel agent who gives me both a loyalty reward and cash back. It makes booking direct more expensive yet were I to do so the hotel avoids commission.

  Before the demise of hotels.com I rarely looked thoroughly at hotel prices as they worked out better. But since they scrapped the reward scheme I have been. There are some surprises lurking! For example, booking.com seems to offer some properties through “partners” at much lower cost. You can see the same room listed on their website through booking.com direct and their partner. The latter being say 20% cheaper!

  It’s all very confusing and, of course, time consuming too, now to find the best bargain. Initially I thought the partner was a way of offering a less desirable room, one that was not selling well. One such booking was for a twin room and when I checked in the reception would not change it to a king bed and actually told me I had a bargain rate. But using the same hotel the following week booked through the partner at a cheaper price they upgraded me to a bigger better room at check in.

  • JDB says:

    27 Sep27 September 07:51

    @Greenpen – yes, Booking.com offers different prices to different people depending how you access the site and often offers totally different prices on Agoda, part of the same group. These sites are useful to check prices to have the information to deal directly with the organ grinder who controls price and every other aspect of your stay.

    • Erico1875 says:

      27 Sep27 September 08:03

      My searches always start with Trivago.

      • Oviplokos1 says:

        27 Sep27 September 11:42

        Why?

        • Aston100 says:

          27 Sep27 September 12:34

          Good search engine.

        • Erico1875 says:

          27 Sep27 September 18:20

          I can do all my filtering from there. I.e facilities, pool, no of stars , satisfaction rating etc.
          Sometimes some pricjng anomalies come up.
          For instance Holiday Inn, Cavelossim, Goa. Book direct or various sites, £200 a night. My dates in December, Hotel.com £80 pn
          Similar discount for the Radisson, via Travel Republic.

• John says:

  27 Sep27 September 07:43

  “Hotel groups basically promised Expedia Group, Priceline and Booking.com”

  Just for clarification, Priceline.com is a brand/subsidiary of booking.com

• Axel says:

  27 Sep27 September 07:47

  I thought Booking Holdings in Conneticut owns all threee, or at least two of these OTA’s. Similar to IAG owning different “competing” airlines which explained the ridiculous 22% commissions.

  My own industry has online agents, and I currently pay 1% by comparison.

  • Nico says:

    27 Sep27 September 08:01

    Priceline is part of booking holding, it actually used to the name of the holding company (priceline.com) , expedia is a real competitor.

• Dev says:

  27 Sep27 September 08:13

  No idea if this is a linked issue or not but the fact that ÔTA bookings receive no stay credit in hotel schemes is a big annoyance … especially when you have a dedicated workplace travel agent where the operators start using their own brain cells rather than filleting dedicated instructions.

  • Ken says:

    27 Sep27 September 08:46

    Workplace travel agents should surely be looking for best value for the company rather than how an employee can maximise their points/rebates.
    The points cost the hotel owner not the brand (IHG for example).

    • Rob says:

      27 Sep27 September 08:56

      Big study recently showed branded hotels are more profitable than independents because they spend virtually nothing on marketing or sales beyond the brand fees.

    • dev says:

      27 Sep27 September 09:31

      except when you pay a fortune because your employer signs a rubbish contract, and you receive the worst room, no breakfast and other small negotiated perks. My one is so bad that we arrive at the hotel to find that its an expedia or booking.com rate and that they think we are some one off visitor and get treated as such.

      • Ken says:

        27 Sep27 September 10:44

        That will be when the employee is passing costs on to a client but gets a nice end of year rebate from the travel agent.
        Which naturally clients never see…

      • Talay says:

        27 Sep27 September 12:44

        Employer ? strange concept.

  • Andrew. says:

    27 Sep27 September 09:07

    Big annoyance for some, but really useful if you as an individual have access to workplace negotiated/corporate pricing via your employee benefit portal. The rates generally have breakfast included, and usually an upgraded room.

• yonasl says:

  27 Sep27 September 08:17

  I recently discovered that using hotels.google.com shows (sometimes) much lower rates than going directly to hotels/booking/agoda.

  So first start your search in hotels.google.com and then click on their link to book with an OTA or directly.

  • Talay says:

    27 Sep27 September 12:45

    Equally, using a VPN or even incognito browser can throw up differences.

    I even have physical machines in other locations I can use.

• brian says:

  27 Sep27 September 08:56

  “In their defence, online travel agents claim that they will lose out. The agents provide a helpful service for you by listing, say, all 4-star hotels with a swimming pool in a specific area of London, but customers would then go off and book their preferred choice directly if it is cheaper.”

  This seems like a justifiable concern when it comes to their business model but equally as unfair to those who don’t use these services. Why should I as a consumer have to pay an inflated price when booking directly? Fortunately the industry has found a number of loopholes to mostly offer value when going direct.

  • Ken says:

    27 Sep27 September 09:26

    It’s a pretty thin defence though isn’t it.

    Considering that retail price maintenance is generally illegal & the Net Book Agreement was ruled anti competitive in the 1990’s, I’m surprised it has taken so long.

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